A Parent Can Acquire the Shares in a Subsidiary on a "Cum

Multiple Choice

A parent can acquire the shares in a subsidiary on a "cum div." or an "ex div." basis. If the shares are acquired on a cum div. basis:

A) The parent is not entitled to the dividend declared at acquisition date.
B) The parent acquires two assets - the investment in the subsidiary and the dividend receivable.
C) The dividend payable recorded by the subsidiary is a liability of the group.
D) Both the dividend receivable and the dividend payable are not eliminated on the consolidated statements.